Organizations may fail to grow beyond the small family-business model into something larger simply because their structure does not allow for expansion. I have seen how the governing boards of small churches often insist on making all the tactical decisions–from what color to paint the foyer to whether or not to support some new missionary project. A decentralized structure that would enable the organization to stretch and grow might require the top governing body to shift to a system of governance by policy rather than by direct management (Carver, 1996). Decentralization includes the ideas of valuing good ideas, regardless of their source, resolving problems where they occur, removing unnecessary bureaucracy, and pushing decision-making authority out to the extremities of the organization. According to Nadler and Tushman (1997), “decentralization typically translates into greater speed, because decisions can be made by the people directly involved in the action” (p. 122). Decentralization has also been credited with higher job satisfaction, better decisions, and more creativity (Marquardt & Reynolds, 1994, p. 56; McMahon, 2001).
The Decentralization-Empowerment Link
Individual empowerment is unlikely to occur within a highly centralized system of command and control. Command and control structures–which have also been referred to as mechanistic or bureaucratic structures–place all decision-making power into the hands of the few who occupy the center, thereby inhibiting individual initiative. When you do not allow people to act upon their better judgments, they will tend to keep those judgments to themselves. It’s a bit like when a husband tries to wash the dishes and his wife stands over his shoulder telling him where to put the dishes that are waiting to be rinsed, which dishes to wash first, and how much soap to put into the water. It’s demotivating; he never wants to wash dishes again.
In policy governance, the top leadership defines the core and also the outer parameters of the organization, but allows freedom of movement and decision-making in the space between these two boundaries. Charles Handy (1994) describes this kind of organizational structure as being like an inside-out doughnut. The core of the doughnut, instead of being empty, is full; it is the part of the organization that is essential to what it is supposed to be doing. It should be clearly defined by the leadership core. The outer ring of the doughnut is empty (hence the inside-out doughnut) and represents “our opportunity to make a difference, to go beyond the bounds of duty, to live up to our full potential” (p. 70). Employees (or lay leadership in the church) are free to exercise their gifts and talents as they see fit as long as they are in alignment with the core parameters.
The Value of Front-Line Insight
By becoming evermore involved in directing the organization as a whole, leaders often no longer find the time to make contact with the customers whom they serve. As leaders move up the organizational structure, they isolate themselves from the very customer whom the organization claims to serve. Having lost touch with the customer, they also lose the perspective of the customer. The experience and latent knowledge of the front-line worker then becomes essential to the survival of the organization. This is not a problem for decentralized organizations, because those at the lower levels, or at the outer extremes of the doughnut, those who still have direct contact with the people, have the power to influence the direction and programs of the organization.
Another way to say this is that an organization is like a series of interconnected rivers and streams with information, decisions, actions, and outputs flowing out toward the customer. Highly centralized organizations create the notorious bottleneck effect, where the information and decisions get clogged up being always funneled through the top leadership and thus causing flooding and delays and an inferior service.
The negative effect, however, is not only seen in an inferior work flow, but also in what such a structure does to the very employees we are trying to empower. Organizational learning is inhibited because people are not motivated to learn when they don’t have authority to do anything with what they have learned (Denzau & North. 1993). They become passive and dependent, forever waiting on someone else to make the decisions before they act and withholding valuable insights they may have because, “Why bother, when nobody pays attention to my ideas anyway.” Leaders may lament the lack of commitment and loyalty of their people, without ever considering how their structural issues may be contributing to the problem.
Why We Resist
These leaders may not “see” structure as a problem because to consider an alternative way to structure themselves conjures up fears of anarchy and loss of control. Distrust is at the heart of a manager’s resistance to decentralized structure. The manager may harbor suspicions that, hidden within the claims of improved results derived from decentralization, lies a secret plot to undermine the foundations of the organization. We fear letting go of the reins of control and we suspect that calls for decentralization may stem from some underlying philosophy of anarchism.
This fear is not completely without foundation. Decentralization does carry within it some inherent dangers that must be understood and adequately dealt with if the organization is to derive its benefits and avoid its pitfalls. Daft (2004) warns, “Decentralization and employee freedom are excellent for initiating ideas; but these same conditions often make it hard to implement a change because employees are less likely to comply. Employees can ignore the innovation because of decentralization and a generally loose structure” (p. 407). This is why it is so important to rigorously define the core–the purpose, vision, goals, and expected outcomes of the organization–and to insist on the achievement of that core. Responsible decentralization does not mean less accountability but more, but it is an accountability to the core, not to the hierarchy. Responsible decentralization will be characterized by the clear definition of core processes, insistence on loyalty not only to one’s own autonomy but also to the organization as a whole, true buy-in on the part of the managers, and effective communication systems that provide the employee with the information he or she needs to make wise decisions.
The Paradox of Decentralization
This is an intriguing paradox. On the one hand, decentralization places more autonomy and authority in the hands of individuals at the lower levels of the organizational structure. On the other hand, it also requires more directiveness in the definition of expected outcomes. It requires a fundamental shift in the function of the manager who “must learn to specify the measures of success as well as the signs of failure [but] must then allow his or her people the space to get on with it in their own way” (Handy, 1990, p. 132).
The Priesthood of All Believers
In the domain of the Christian church, a concept that is congruent with decentralization has been referred to by theologians as the “priesthood of all believers” (Ketcherside, 1956). It is the idea that God has gifted and called every believer into religious ministry, that this calling is not limited to a specially designated class of religious men or women within the church. At the root of this doctrine is the New Testament doctrine that every member of the Body of Christ has a direct, vital, continuous, and living connection with God through the Holy Spirit (e.g., Romans 8:14). If this is the case, then one would expect the creative force of ideas and vision to flow up from the common member of the church. This is the very picture that we find of the primitive church as recorded in the New Testament scriptures. The early Christians seemed to understand intuitively that good ideas and sound judgment are not the exclusive rights of a privileged few at the apex of an organizational pyramid. God was moving in and through His people, regardless of title, social status, or job description.
Empowerment is not just a set of ideas or attitudes. Though these are essential, as we saw in previous posts, an empowering work environment also requires some structural adjustments that will enable more people to make decisions and to take on the responsibility of those decisions.
Questions for Reflection
(1) What are the benefits of decentralization? (2) What are its dangers? (3) How can an organization achieve the benefits and avoid the dangers? (4) How can an organization’s structure either enhance or hinder the spiritual development of its people?
Sources Cited
Carver, John, and Miriam Mayhew Carver, Basic Principles of Policy Governance. San Francisco: Jossey-Bass, 1996.
Daft, Richard L., Organization Theory and Design. Mason, OH: South-Western, 2004.
Denzau, Arthur T., and Douglass C. North. Shared Mental Models: Ideologies & Institutions. Washington Uiversity: Center for the Study of Political Economy, 1993.
Handy, Charles, The Age of Paradox. Boston: Harvard Business School Press, 1994.
Handy, Charles, The Age of Unreason. Boston: Harvard Business School Press, 1990.
Ketcherside, W. Carl. “The Royal Priesthood.” ed. Restoration Movement Texts. St. Louis, MO: Mission Messenger, 1956.
Marquardt, Michael J., and A. Reynolds, Global Learning Organizations: Gaining Advantage through Continuous Learning. New York: Irwin, 1994.
McMahon, J. Timothy. “Participative & Power-Equalized Organizational Systems.” In Classics of Organizational Behavior, ed. Walter E. Natemeyer and J. Timothy McMahon, 294-302. Long Grove, IL: Waveland, 2001.
Nadler, David A., and Michael L. Tushman, Competing By Design: The Power of Organizational Architecture. New York: Oxford University Press, 1997.
Water Lily Pads at Atlanta Botanical Garden Photo by D. McAbee (March 3, 2008), Available at http://www.morguefile.com/archive/?display=201047&